Dan Hodges is a former Labour Party and GMB trade union official, and has managed numerous independent political campaigns. He writes about Labour with tribal loyalty and without reservation. You can read Dan's recent work here

Ed Miliband may just have given himself a fighting chance

For a political re-launch, it was a little short on pyrotechnics. Those hoping Ed Miliband would stride to the lectern at the Oxo Tower and deliver his address in the timbre of James Earl Jones were disappointed. Rumours that Labour’s leader would show his true grit by arriving at the venue astride a raven-maned charger named “Bullet” also proved, sadly, wide of the mark.

But style is not really Ed Miliband’s style. He’s much more comfortable with the substance of politics, rather than the ephemera; all that petty stuff like whether the voters think he would make a good Prime Minister or not. And today, beneath the usual caveats, equivocations and empty rhetorical flourishes, he delivered a speech of significance.

For the past 18 months Ed Miliband’s leadership has resided in Never-Never land. In this idyllic dreamworld, Labour lost the election – and the electorate embraced David Cameron, and his cruel message of Right-wing austerity – because the voters secretly wanted Gordon Brown and his party to be more Left-wing. The center of politics was shifting to the Left, and all that was required was for Labour to commit itself to spending its way out of the current financial crisis and mount a vigorous opposition to every Tory cut, and Ed Miliband and his party would find themselves swept back to power, as a grateful populace embraced the New Politics.

Today was the day Labour’s Peter Pan finally grew up. “Whoever is the next Prime Minister will still have a deficit to reduce, and will not have money to spend,” he said. “Whoever governs after 2015 will have to find more savings.” His party would have to accept that “we will have to make difficult choices that all of us wish we did not have to make”.

OK, the rest of the speech was lost beneath the usual meaningless homilies about fairness, and justice, and how Labour was all about making a difference. As opposed to what, the agenda of unfairness, injustice and total irrelevance beloved by all politicians? But there was no escaping the fact that Ed Miliband was charting a new course for his party. And who knows, perhaps his country.

Contrary to the impression he has been trying to cultivate since the turn of the year, Miliband isn’t stupid. He can read the opinion polls and look at the approval ratings. And he has seen as clearly as anyone else that his political strategy isn’t working. The rules of the game are not changing. The Westminster hothouse is no-place for “Zen socialism”. Despite the cultish preaching of the flat-earthers, Labour’s favoured solution of borrowing and spending its way to economic credibility is failing catastrophically.

“In Europe, economic crisis has thrown up a political paradox: in the wake of the most spectacular failure of global markets since the 1930s, electorates have turned to the Right rather than the Left,” wrote Stewart Wood, Ed Miliband’s most trusted advisor yesterday. “They have done so in part because of a concern that in straitened times the policies of social democracy come with a price tag that is unaffordable”.

This is not just rhetoric. Well, actually it is. But it’s rhetoric that the Labour party has not been accustomed to hearing from the leader of Generation Ed, or the travelling circus of political dilettantes he chose to surround himself with.

“Since the autumn statement we have been facing a new environment,” said a Labour source. “We will inherit a significant deficit after the next election. That’s the blunt fact. We’d have liked the Tories to adopt a different course, but they haven’t. The party is going to have to face up to that reality.”

Ed Miliband wasn’t elected to make the Labour Party face reality. He was the antidote to reality. His election, of itself, the avoidance of a tough choice. But now, having begun to chant the mantra of difficult decisions, he will need to take some. Yes, they were few and far between today. But they will come. They have to. He has no moves left. His has not yet entered the last chance saloon. But he is standing by the swing doors, starring at the Bourbon.

Ed knows this. He knows too that there can be no more re-launches, nor is there scope for further vacillation or equivocation. He has reached the defining hour of his leadership.

Today’s was not the speech of a future Prime Minister. Nor was it even a speech guaranteed to get his leadership back on track. But it might – just might – have been the speech that gave him and his leadership a fighting chance.